Real Estate Thought Leaders at Inman Connect, Comment on Economy

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I was fortunate enough to attend the Inman Connect real estate conference over the last week in New York.  Although I attended in San Francisco last summer, this year was different for particularly one reason.  The mood was optimistic.  The last 12 months has been hard on many of us in the real estate business and we’ve been looking for reassurances that the market will improve.  I had the opportunity to attend a panel specifically about the economic outlook of the real estate business both near and long term.  The panel was moderated by Brad Inman, founder of Inman News and consisted of an all-star cast of real estate thought leaders from various sectors of the industry. While the outlook was mixed there was a general consensus that the worst is behind us.  I’ve put together a quick summary of each panelist’s comments and predictions on the market.

Photo of Greg Rand, Sean O'Toole, Patrick Stone, Carter Murdoch, Nishu Sood, Brad Inman

Greg Rand, Sean O'Toole, Patrick Stone, Carter Murdoch, Nishu Sood, and Brad Inman

Carter Murdoch a Senior Vice President of Strategic Alliances at Bank of America is neutral on the recovery.  Although the savings rate is coming back (7-10%), it had been negative for some time.   Murdoch feels due to tougher lending, Americans will need to save money for buying homes again saying, “The new normal is here to stay for the seeable future. Plan accordingly.”  When asked if he sees lending standards loosening up, he mentioned some loosing will start to happen in the near term (As I proof this, HUD lifted the 90-day seasoning requirement for FHA Buyers).

Sean O’Toole, CEO is concerned about foreclosure limbo (homes which are underwater but have yet to be foreclosed).  He’s a short-term optimist due to holding back inventory by the banks.  O’Toole offered the following quote, “The housing crisis won’t truly end until we deal with the real problem…negative equity”.

Greg Rand, CEO and Managing Partner of Better Homes and Gardens Real Estate Rand Realty is very bullish on the real estate market saying, “This is not now, nor has there ever been a housing meltdown”.  He cites the public simply stopped buying because the prices went too high.  This same public, he states, hasn’t been waiting on tax breaks and government intervention, they’ve simply been waiting on the prices to come down.  Rand believes prices are coming back in 2011 after stabilizing in 2010.

Nishu Sood a Research Analyst at Deutsche Bank Securities is bearish on the real estate market in 2010 calling it a “triple-u” (or uuu) shaped recovery.  He offered the following quote:  “Back to the 1960’s – This housing downturn might unwind several decades of home ownership gains”.  Sood believes there is tremendous risk in the market right now and the biggest threat is the Fed withdrawal from helping prop the market up.  This includes the first-time buyer credit and the fed ceasing to purchase mortgage back securities. Overall he said it will be a very jagged ride in 2010 with potential improving in 2011.

Patrick Stone, Chairman of The Stone Group is an optimist.  He believes the market is starting to clear as the number of vacant housing stock (homes and apartments) as a percentage as a whole is starting to drop since peak in 2007 (from nearly 3% of all housing just over 2%).  Stone states that housing affordability is back in line. Now affordability is at just over 3 times income.  One of Stone’s biggest reasons for being an optimist is due to investor dollars coming off the sidelines and buying up many properties, mentioning the court house step auctions are now becoming very crowded.  Stone also projects a 5% appreciation in home prices in California during 2010.

Parting Words

As the session came to a close, they all gave a quick parting statement.  I particularly thought Patrick Stone left an interesting comment directed to those of you thinking about buying and holding rental homes.

Patrick Stone: “I recommend buying homes and renting them out because they’re not building them anymore.”

Greg Rand, “Shake off 2009.  It was a bad dream.  It never happened.  Wake up and attack your jobs today!”

Sean O’Toole: “As you are earning money in the next 6 months, save some of it.  You might need it.”

Carter Murdoch: “Work hard and try to retain your job.”

Nishu Sood: “Be thankful if you’re not building new homes.  The resale market is going to be much better than the new home market.”

In all, this group of real estate thought leaders feels the real estate market and economy are not healthy right now but are on the path to correcting.  It leads me to shake off the hype surrounding real estate investing about “windows of opportunities” closing, and turns that belief into more of a garage door mentality.  There is a huge amount of opportunity in the market.  This we all know.  The reality is that opportunity is going to be here for a while.

About Author

Ryan Hinricher is a Real Estate Entrepreneur, Blogger, Change Advocate and Founder of Investor Nation, a concierge realty and real estate investment company focused on the needs of the residential investment home community.


  1. Hi Ryan – thanks for the nice write up an mention. One minor clarification. I’m actually not concerned about the shadow inventory of bank owned homes (I’ve actually written quite a bit about how I don’t believe there is any at Instead I’m concerned by the number of homeowners, that are underwater, delinquent, or in the foreclosure process, that have yet to be foreclosed on. Hard for me to see how we have a truly healthy housing market until we resolve those issues. Thanks again.

    • Sean, I appreciate the clarification. My mistake was shadow inventory vs. foreclosure limbo. Just read your recent post at Also I recently heard that before the crisis only 26% of homes that started the foreclosure actually ended in foreclosure. And that number was now around 70% or higher are actually foreclosing due to short staffing at banks, (source is a webcast I was on via I’m also curious about the trending down of this number meaning more workouts will occur. I would appreciate any of your feedback on these numbers or your thoughts on the trending of numbers of underwater homeowners.

  2. Tom Brintzenhofe on

    Thanks Ryan- I too was unable to attend. Thank You for the update. I think the market will come back around. There have been positive signs in our area of the progress in the market. While most people will focus on the negative I try to see the best in every situation. The current market opened up tons of opertunities for investors to buy up properties a reduced prices thru forclosures and short sales. The old saying” Life gives you lemons…make some MIKES HARD LEMONAID”

    • Tom, good words! One of the comments made by Greg Rand at the event was the fact the media blew this out of proportion which caused people to panic. The panic created the opportunity. Should be interesting to see how the next year unfolds.

  3. Sean, correct me if I am wrong, but by calling you a “short-term optimist” is kind of like saying that the very short-term future of the first-time heroin user is really, realy awesome. The short term is beside the point, given the 7 million and growing homes that are likely near-term foreclosure candidates which will do God-Knows-What to prices, ensuring a massive oversupply of houses for the foreseeable future.

    And what about Option ARMS?

  4. Josh, I felt the “short-term optimist” was particularly interesting. I guess he’s basing this primarily on the government intervention. I wish we could have pulled out the government intervention and compare how things would look today without it. Do you think we’d be better, worse, or same? I’m thinking roughly the same maybe only slightly worse. Not sure how much difference it’s made.

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